Expert Witness Need Not Be An Expert, Says Court

  Vernon Cooks Jr. was convicted of being the mastermind behind an ingenious but misguided scheme to cheat mortgage lenders by fraudulently obtaining house mortgage loans. In most of the accused transactions the documentary evidence and trial testimony show that Cooks followed the same basic pattern. For each transaction, Cooks first recruited an inexperienced real [...]

Bad Appraisal By Lender

Question: In 2007, I applied for a 2nd mortgage for debt consolidation through Capital One Mortgage over the phone and was immediately approved over the phone. When I inquired as to when they would be doing an inspection on my studio (condo), I was advised by the mortgage broker they pulled my value off the [...]

Mortgage Fraud: Should the Lender be Sued by the Borrower?

A mortgage broker submits a fraudulent loan file to a lender, which promptly funds the loan. The borrower – whose identity has been stolen by the mortgage broker – doesn’t even know that he is now the proud owner of an overpriced white elephant, which promptly goes into default. Sounds familiar? The mortgage broker/realtor/closing agent [...]

Say Goodbye to “Stated Income” Sub-Prime Loans

On December 18 the Fed endorsed new rules that would give people taking out home mortgages new protections against shady lending practices. The proposed rules, approved in a 5-0 vote by the board, are geared to providing safeguards to the riskiest “subprime” borrowers, already painfully stung by the housing and credit debacles. The proposal is [...]

Ex-NFL Star Indicted for Mortgage Fraud

FIVE INDICTED IN MORTGAGE FRAUD SCHEME [HOUSTON, TX] – A licensed Texas attorney and real estate developer, a sports agent, two bank loan officers, and a real estate appraiser have been indicted in a multimillion dollar mortgage fraud scheme, United States Attorney Don DeGabrielle, interim Special Agent in Charge Alex J. Turner of the FBI [...]

Did You ‘State’ Your Income On Your ‘Stated Income’ Loan?

Well, for those of you who live in Arizona, we hope you did not inflate your income on your loan application. House Bill 2040 – about to be signed by the Governor – makes that a felony in your state. Arizona is among the top 10 states in the number of foreclosures filed this year. [...]

From the FBI: All You Need to Know About Mortgage Fraud

MORTGAGE FRAUD INDICATORS Inflated Appraisals • Exclusive use of one appraiser Increased Commissions/Bonuses – Brokers and Appraisers • Bonuses paid (outside or at settlement) for fee-based services • Higher than customary fees Falsifications on Loan Applications • Buyers told/explained how to falsify the mortgage application • Requested to sign blank application Fake Supporting Loan Documentation [...]

This Cop Did His Mortgage Scamming On The Side

Susan W. Brooks, United States Attorney for the Southern District of Indiana, announced that MICHAEL C. SMITH, 45, Indianapolis, Indiana, JOSEPH BRITTON, 47, Fishers, and MARK SPECKMAN, 48, McCordsville, were sentenced to federal prison on Tuesday and Wednesday of this week by U.S. District Judge Sarah Evans Barker following their convictions for conspiracy, wire fraud, [...]

Colorado may criminalize coercion of appraisers

Many of the mortgage fraud cases in the past 4 years have been done through collusion between the mortgage broker and the appraiser. The latter, who gets most of his referrals from the former, has agreed many times to cooperate in inflating property values. Colorado is fighting back: Mortgage brokers would be expressly prohibited from [...]

“Flipping” Homes Nets Perp 24 Years in Prison

What makes this case so different (and explains the harsh penalties) is that the perpetrators created a self-contained mortgage fraud operation. It included a loan officer, who was the mastermind behind the scheme, bank underwriters who cooperated and approved the loans submitted by the loan officer, and an unlicensed appraiser who supplied the fraudulent appraisals: [...]